Climate Change STRATEGY

Enabling poor rural people to overcome poverty

Climate ChangeStrategy

Enabling poor rural people to overcome poverty

Cover photo: © IFAD/G.M.B.Akash

Printed by Palombi & Lanci, Rome

May 2010

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Abbreviations and acronyms 3

Executive summary 6

1. Background 8

2. How a changing climate will affect poor rural women and men 10

Impact of a changing climate 10

Impact of the world‘s response to climate change 11

Enhancing IFAD’s approach to rural development 13

3. Maximizing IFAD’s impact on rural poverty in a changing climate 18

Operations 19

Knowledge, innovation and advocacy 21

Resource mobilization 24

Organization 25

4. Measuring success 28

AnnexesI. IFAD Climate Change Strategy results and implementation framework 30

II. IFAD/GEF portfolio: Building on a strong foundation 32

Contents

Abbreviations and acronyms

COSOP country strategic opportunities programme

ENRM environment and natural resource management

ESA environment and social assessment

FAO Food and Agriculture Organization of the United Nations

GDPRD Global Donor Platform for Rural Development

GEF Global Environment Facility

IFI international financial institution

KSF key success factor

LDCF Least Developed Countries Fund

NRM natural resource management

ECD Environment and Climate Division (IFAD)

QE quality enhancement

RB-COSOP results-based COSOP

SCCF Special Climate Change Fund

UNCCD United Nations Convention to Combat Desertification

UNFCCC United Nations Framework Convention on Climate Change

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Executive summary

The speed and intensity of climate change

are outpacing the ability of poor rural

people and societies to cope. Many

smallholders with whom IFAD works are

already reporting impacts on the key

ecosystems and biodiversity that sustain

agricultural production, rural infrastructure,

market opportunities and rural livelihoods.

The world’s response will have an impact

on the ground through the degrees of

temperature increase, whether smallholders

will be able to benefit from credible financial

mechanisms for mitigation, and whether

additional public climate financing will reach

poor rural people.

IFAD is enhancing its approach to rural

development in the context of increasing

environmental threats, including climate

change. Our programmes will continue

to reflect the complex reality of poor

smallholder businesses, where issues are

not contained neatly in boxes labelled

according to global issues. And IFAD will

continue to target its investments at the

poorer and often most climate-change-

affected people – whose livelihoods depend

largely on agriculture and natural resources

– particularly at women as producers and

indigenous people as stewards of natural

resources. But there is recognition that

climate-related risks, and potential

opportunities, can be addressed more

systematically within our projects and policy

advice. For example, we cannot rely on

historical rainfall and temperature averages,

since climate change is increasing the scale

of volatility and risk. We need to be alert to

new sources of risk, and there may be more

opportunities in the future to reward

emissions reductions.

Environmental threats such as climate

change are inseparable from IFAD’s mission

of helping poor smallholders (including

fishers, pastoralists and agroforesters).

Climate change is multiplying their existing

risks, creating new ones, and – depending

on the global response – creating some

new opportunities as well. The goal of

this strategy is to maximize IFAD’s impact

on rural poverty in a changing climate.

This goal is further articulated in three

statements of purpose: to support

innovative approaches to helping

smallholder producers – both women and

men – build their resilience to climate

change; to help smallholder farmers take

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advantage of available mitigation incentives

and funding; and to inform a more coherent

dialogue on climate change, rural

development, agriculture and food security.

IFAD is already active on climate change,

but it can do more. The main strategy

output is a more ‘climate-smart’ IFAD,

where climate change – alongside other

risks, opportunities and themes – is

systematically integrated into core

programmes, policies and activities:

• On operations, climate change can be –

and in many cases already is – factored

into IFAD’s operating model. This means

incorporating it into our toolkit for the

early stages of country programme and

project design and for implementation.

• On knowledge, innovation and advocacy,

IFAD will: explore new arrangements for

sourcing climate-related expertise, share

ground-level experiences to ensure their

application throughout IFAD-supported

programmes, and continue our work

to shape the global dialogue on climate

change for smallholders.

• On resource mobilization, our primary

focus is to make IFAD’s expanding

overall portfolio climate-smart. Increased

supplementary climate funds will

continue to be sought to deepen the

integration of climate change into

IFAD’s core programmes and to

cover the increased cost this implies.

We will seek to mobilize additional

Global Environment Facility (GEF)

resources for global environment and

climate change activities.

• On internal organization, IFAD will make

greater use of existing in-house skills

and people, and will implement a new

organizational structure that brings

together and increases its staff capacity

on climate and the environment. It will

also continue to demonstrate the values

of environmental awareness internally.

Key partnerships are addressed throughout

the strategy, based on the principle that

IFAD will have the most impact when we

work with and through others.

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1

Background

At the Consultation on the Eighth

Replenishment of IFAD’s Resources, in

2008, the Executive Board requested that a

corporate strategy on climate change be

presented for approval by April 2010. The

Board requested a strong operational focus.

This focus ensured that IFAD activities at

the country level are consistently and

systematically built on an awareness of the

potential effects of climate change, and that,

wherever appropriate, climate change

adaptation is incorporated into project

design in a manner consistent with national

policies and that supports governments in

realizing their climate change objectives.

This strategy is based on extensive in-

house and targeted external consultation.

It is the work of an internal IFAD policy

reference group on climate change, in

which all key IFAD divisions played an active

role. It has benefited from consultations

with international financial institutions (IFIs),

foundations, civil society and donor

agencies. Many elements of the strategy

will benefit from further consultation

and development in our work to develop

the environment and natural resource

management (ENRM) policy, which will

address a range of environmental

challenges and provide a more detailed

focus on IFAD’s natural resource

management (NRM) activities.

Annex I provides a results and

implementation framework for the strategy.

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Impact of a changing climate

Agriculture is where climate change, food

security and poverty reduction intersect. For

most of the one billion extremely poor and

hungry people in developing countries,

agriculture is the main income source.

These people are already vulnerable, and

climate change will in most cases increase

this vulnerability. While trying to cope with

the effects of a warmer climate, agriculture

is simultaneously facing two other

challenges: it must double food production

in developing countries by 2050 to meet

population increases and dietary changes,

and must be central to efforts in

greenhouse gas reduction.

Climate change is a ‘threat multiplier’ – it

increases a range of livelihood threats and

vulnerabilities, rather than being an isolated

specific risk. Over the centuries, human

societies have developed the capacity to

adapt to environmental change and climate

variability. These adaptations include

practising shifting cultivation, adopting new

crop varieties and modifying grazing

patterns. But today the speed and intensity

of climate change are outpacing the speed

of those autonomous actions and threaten

the ability of poor smallholders and rural

societies to cope. In the countries most

reliant on rainfed agriculture and natural

resources, poor rural women, who are often

the primary food producers, but have fewer

assets and less decision-making power, are

even more exposed than men.

Many communities with which IFAD works

are already reporting changes:

• The key ecosystems and biodiversity

that sustain agricultural production.

Climate change contributes to: reduced

water resources; changes in the primary

productivity of crops, forage and

rangeland; changes in the composition

of plant varieties and quality of plant

material; and reduced biodiversity,

marine life and animal (and human)

health. For some countries, the decline

in yield from rainfed agriculture could be

as much as 50 per cent.1 Scarce and

highly variable rainfall has already

decreased the resilience of the high

plateau rangeland ecosystems in eastern

Morocco – the Alfa grass ecosystem is

severely degraded and the carrying

capacity of rangelands is no longer able

to sustain growing demand.2

• Rural infrastructure and market

opportunities. Fragile rural

infrastructure, such as rural roads,

drainage and irrigation systems, storage

and processing, and livestock

infrastructure will come under increasing

pressure. In turn, market opportunities

for smallholder farmers will be reduced.

For example, IFAD’s Viet Nam country

strategy describes how flooding has led

to extensive damage to irrigation

systems and other agricultural

infrastructure. Reduced availability of

food in local markets as a consequence

of climate change may also increase

food prices. According to the

Intergovernmental Panel on Climate

Change, a global mean temperature

increase of 3 to 5 degrees could lead to

a pronounced increase in food prices of,

on average, 30 per cent.3

How a changing climate will affect

poor rural women and men

21 Cline, W. R., Global

warming and agriculture.

Impact estimates by

country (Washington D.C.:

Centre for Global

Development and the

Peterson Institute for

International Economics,

2007).

2 Source: Direct

experience of IFAD-

supported projects.

3 Easterling, W. E., P. K.

Aggarwal, P. Batima, K. M.

Brander, L. Erda, S. M.

Howden, A. Kirilenko, J.

Morton, J.-F. Soussana, J.

Schmidhuber and F. N.

Tubiello, “Food, fibre and

forest products,” in Climate

Change 2007: Impacts,

Adaptation and Vulnerability.

Contribution of Working

Group II to the Fourth

Assessment Report of the

Intergovernmental Panel on

Climate Change, ed. M. L.

Parry, O. F. Canziani, J. P.

Palutikof, P. J. van der

Linden and C. E. Hanson

(Cambridge, United

Kingdom: Cambridge

University Press, 2007),

273-313.

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• Rural livelihoods. Despite urbanization,

the majority of the poorest people

continue to live in rural areas and to

depend on agriculture for their

livelihoods. Environmental degradation,

erosion of natural resources and

biodiversity loss are challenging their

ability to cope with and adapt to climate

change, and to ensure food security.

Climate change may result in more

migration, food insecurity, conflict over

scarce resources (for example between

pastoralists and agriculturalists) and

possible forced sales of livestock and

other assets. As primary providers of

food, fuel and water in most developing

countries, women are on the front line of

climate change impact. Indigenous

peoples are particularly affected due to

their high dependence on the natural

resource base. Communities where IFAD

works have noticed changes in the

duration of heat and cold waves, and in

the patterns and predictability of rainfall.

In Mongolia, for example, where average

temperatures have risen 1.8ºC over the

last 60 years,4 the melting of high

mountain glaciers has increased and

permafrost is degrading. The ground

water table is decreasing in arid regions,

and degradation and desertification of

the land have been intensifying due to

the shortage of water and precipitation.

Impact of the world’sresponse to climate change

National and international policymaking on

poverty reduction, food security, climate

change and the environment (including

biodiversity and land degradation) has often

treated each issue separately. This is

changing, but it reflects a deep challenge at

the country level, not just in poor countries,

but in many richer countries as well.

Climate change needs to transform from an

issue owned by one single environment

ministry to one owned by heads of state

and shared by all key ministries, including

agriculture ministries. Otherwise the national

and global dialogues risk progressing along

separate and incoherent tracks.

The global response will itself have an impact

on smallholders. Climate negotiations will

continue in 2010 with the aim of achieving

progress at COP16 (the Conference of the

Parties of the UNFCCC) in Mexico. The

global response to climate change will have

an impact on smallholders through three

main channels:

First, the extent of global emissions

reductions, and the extra cost to poor

rural people associated with inaction. The

longer it takes to reach an ambitious

agreement on global emissions reductions,

the higher the likely temperature rise and

the greater the additional risks and costs

to smallholders. According to the World

Bank, developing countries will need

US$75-100 billion extra per year for the

cost of adaptation to climate change over

the period 2010-2050.5 In the agriculture,

forestry and fisheries sectors, the cost

would range from US$7.3 billion to

US$7.6 billion per year.6

Second, the extent to which smallholders

will be able to benefit from credible

financial mechanisms for mitigation. Land

use is a big part of emissions – agriculture

represents 14 per cent7 and is the main

driver of other land-use and forestry

4 Cruz, R. V., H. Harasawa,

M. Lal, S. Wu, Y. Anokhin,

B. Punsalmaa, Y. Honda,

M. Jafari, C. Li and

N. Huu Ninh, “Asia,” in

Climate Change 2007

(see note 3), 475.

5 World Bank, Economics

of Adaptation to Climate

Change (Washington, D.C.,

2009).

6 The World Bank analysis

estimates adaptation costs

for major economic sectors

under two alternative future

scenarios: wet and dry, both

based on 2°C warming

during the 2010-2050 period.

7 Agricultural emissions

include carbon dioxide

mainly from land-use

changes; methane from

the livestock sector and

rice production; and

nitrous oxides from the

use of fertilizers.

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emissions, which represent an additional

18 per cent. Smallholders account for only

a small part of agricultural emissions, but

they provide a wide range of largely

unrewarded environmental services that can

contribute to carbon sequestration and limit

other greenhouse gas emissions

(see box 2 for examples). Rewards for

mitigation services come from a number of

sources, but they are currently limited and

do not exist at the scale required. For

agriculture and forestry, for example, carbon

markets are still thin and evolving, with

underdeveloped rules, uncertainty as to

their depth, and concerns about the

potential impacts of capture by larger-scale

investors or of benefits not being passed on

to smallholders. But they hold tremendous

potential – reform of the rules governing the

carbon market to allow smallholders greater

access to carbon finance8 is a possibility

that IFAD will be watching closely.

Third, whether public climate financing is

made available to and will benefit poor

rural women and men. It is highly likely that

climate change will become a more

prominent driver of international financial

support. The Copenhagen Accord includes

a ‘fast-track’ provision of “approaching

US$30 billion for the period 2010-2012” to

be balanced between adaptation and

mitigation, “a goal of mobilizing jointly

US$100 billion a year by 2020 to address

the needs of developing countries,” a

commitment to set up a forestry financing

mechanism, a high-level panel to look at

innovative sources of international finance,

BOX 1 Climate-related IFAD-supported projects: Some examples

Supporting rural people in adapting to harsh climatic conditions has been at the centre of many

IFAD-supported projects. For example:

• In Mongolia, the Livestock Sector Adaptation Project, to be financed through the GEF-managed

Special Climate Change Fund, aims to increase the resilience of the Mongolian livestock

system to changing climatic conditions by strengthening natural resource management,

‘climate-proofing’ pasture water supply, and building the capacity of herders' groups to address

climate change.

• In Kenya, the Mount Kenya East Pilot Project for Natural Resource Management seeks to halt

the environmental degradation, flooding and drought resulting from deforestation and

inappropriate agricultural practices in one of the regions most vulnerable to climate change.

• In Bangladesh, the Special Assistance Project for Cyclone-Affected Rural Households

supported poor rural households hit by the 1991 cyclone in protecting their dwellings against

floods, and established 10 cyclone shelter centres.

• The Western Sudan Resources Management Programme in The Sudan and the Pastoral

Community Development Project in Ethiopia both established early warning systems that

enable rural populations to adjust their livelihoods to the expected effects of drought.

• The Kidal Integrated Rural Development Programme in Mali seeks to establish an environmental

monitoring system for risks such as drought, locusts and livestock diseases, and foresees

measures to mitigate their impacts.

• In China, where farmers are exposed to regular crop failures induced by erratic weather

patterns, IFAD has co-funded an initiative to develop and implement an index-based weather

insurance system.

8 These include allowing

more land-use activities in

the Clean Development

Mechanism (CDM), dealing

with the disincentives for

temporary credits to land-

use activities in the CDM,

enabling more programmatic

CDM approaches that

reduce transaction costs

for farmer cooperatives,

allowing countries to opt

for agriculture in nationally

appropriate mitigation

actions, and a concerted

approach to agreeing on

workable methodologies

to make soil carbon actions

monitorable, reportable

and verifiable.

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and a new Copenhagen Green Climate

Fund. Much of the financial architecture to

channel this potential flow has yet to be

determined. It is also not clear how much of

climate finance will be additional to existing

commitments of official development

assistance. IFAD will continue to press for

disbursement processes that recognize the

particularly high level of synergy between

adaptation and mitigation that exists in

most sustainable agricultural projects; for

climate finance mechanisms that reach

smallholders; and for adaptation to be given

a prominent place in the provision of public

finance for climate change. IFAD will

continue to help mobilize available funding

for poor rural women and men farmers and

managers of natural resources.

Enhancing IFAD’s approach to rural development

Our programmes will continue to reflect the

complex reality of smallholder farming

businesses, where issues are not contained

neatly in boxes labelled ‘climate’,

‘environment’, ‘food security’ or ‘migration’.

Issues often discussed separately at the

international level are interlinked and

integrated for the smallholder farmer.

Thus IFAD’s approach to programme

development continues to be holistic – we

will not look at climate change in isolation.

Climate-related risks and opportunities will

be assessed in a wider development

context including other environment-related

issues – such as population pressures or

local pollution. This is done for conceptual

IFAD projects are already addressing mitigation indirectly through reforestation and improvement of

land use and land management practices. Examples include:

• Implementation of 4,500 hectares of agroforestry systems in Rwanda, increasing yields and

reducing erosion.

• Assisted tree regeneration in the Niger, covering about 100,000 hectares and contributing to

restoring soil fertility and sequestering carbon.

• Two IFAD-supported projects in China are promoting renewable energy. The West Guangxi Poverty

Alleviation Project is helping promote household biomass units, transforming human waste and

animal dung into biogas for lighting and cooking in rural areas. By 2006, almost 30,000 households

had benefited from biogas tanks, saving 7,500 hectares of forest each year. The Xinjiang Uygur

Autonomous Region Modular Rural Development Programme is working to help poor rural people

install solar systems to meet their power needs.

• Two grants to the World Agroforestry Centre (ICRAF) to develop and pilot mechanisms for

rewarding environmental services in Asia and Africa, through, respectively, the Programme for

Developing Mechanisms to Reward the Upland Poor of Asia for the Environment Services They

Provide and the Programme for Pro-poor Rewards for Environmental Services in Africa (PRESA).

• The installation of small-scale biogas digesters and provision of 11,500 units of energy-saving

stoves in Eritrea is another example of a small-scale mitigation intervention.

See Annex II, “IFAD/GEF portfolio: Building on a strong foundation” for a detailed description

of GEF- and IFAD-supported programmes.

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and practical reasons – climate change

often multiplies such risks – and for

operational purposes they should not be

assessed in isolation.

Climate change does not mean throwing

out everything IFAD has learned about rural

development; we must instead build on this

learning. Many of IFAD’s programmes are

implicitly or explicitly designed to increase

the resilience of smallholders and poor

communities to shocks – many of which are

weather-related. A coherent response to

climate change requires continued

emphasis, for example, on country-led

development, gender awareness, targeting

of poor rural people, sustainable

management of natural resources, dealing

with land tenure issues, improving credit

markets, strengthening the quality of local

and national governance, and increasing

productivity. It also remains essential to

recognize the relevance of farmers’

traditional and indigenous knowledge in

addressing issues such as climate

variability, and the differences between

women’s and men’s knowledge and roles in

responding to climate change.

The process of overall agricultural and rural

development can in itself build the resilience

of poor rural women and men to climate

change. IFAD’s existing and increasing

portfolio of support to the building of

agricultural productivity, value addition,

markets and rural infrastructure remains

important. Making better use of more-

productive land also reduces pressure on

farmers to practise extensive approaches

that, with increasing population pressure,

are so vulnerable to climate risk and are

also a major cause of deforestation.

There is a growing recognition, however,

by our clients and in development

organizations that we are often overlooking

risks – and potential opportunities –

created by climate change. This was

reflected in the ARRI 20099 report in the

wider context of the ENRM. A 2006 study

by the World Bank10 found that a quarter of

World Bank projects were assessed as

exposed to a ‘high’ climate risk, but that

only 2 per cent of projects identified climate

risk in their project design documents.

More systematic attention in IFAD-

supported operations to climate-related

risks and opportunities requires additional

reflection and analysis as we engage with

poor communities:

• We can no longer rely on historical

averages – climate change is

increasing the scale of volatility and

risk. For example, historical drought or

flooding frequency is less and less a

guide to the future. And most crops

are already grown at the limits of their

temperature tolerance.

• The impact of a changing climate on

long-term trends needs to be better

understood. While impacts are already

being felt, the worst impacts will be felt

later. For many regions, science yields

clear projections (e.g. drought in North

Africa). Project appraisal has often

discounted such future project risks.

IFAD’s programmes will now draw on the

latest regional and country climate

projections to be alert to the resulting

risks and opportunities.

• There will be new sources of risk

beyond the traditional ones – such as

sea-level rise and glacier-melt impact on

water supply. Smallholder businesses

will need to increase their general

resilience to withstand currently

unidentified shocks. New opportunities

for emission rewards will bring their own

9 IFAD, Annual Report on

Results and Impact of IFAD

Operations (ARRI) evaluated

in 2008 (Rome, 2009).

10 World Bank, Clean

Energy and Development:

Towards an Investment

Framework, prepared

for the World Bank/

International Monetary Fund

(IMF) Development

Committee meeting, April

2006, 120.

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risks – for example, if poor people were

to be excluded from such benefits

through social exclusion and limitations

on land-use rights. ‘Maladaptation’ –

project design that exacerbates

vulnerability – is also a risk (for example,

facilitating habitation in a flood plain).

• Depending on the outcome of

international climate negotiations, there

may be more opportunities to reward

emissions-reduction activities. Payment

systems are currently fairly complex and

may remain so, but rural development

practitioners need to be alert to any

potential future or existing opportunities

to reward smallholders for the mitigation

benefits they produce, including through

access to the carbon market11.

Given that the response to climate change

requires effort across all sectors, and will

vary by country, this strategy does not

make specific sectoral recommendations.

Some country programmes may require

only additional elements or a change

of emphasis within some projects. Others

may require a major rethinking of IFAD’s

sectoral engagement and emphasis –

for example where sea-level rise is

threatening coastal areas. However, some

generalizations are possible:

• Overall, the response to climate change

threats to agriculture is likely to result in

greater support to NRM – such as land

degradation programmes, water

management and community-based

forest management. Efficient irrigation

systems, improved water management

and harvesting, and sustainable use of

ground water are effective adaptation

measures that will help build smallholder

resilience, particularly in drylands (box 2).

This is because the first-round impacts

of climate variability are being felt in

changes in natural resource availability.

This will be further elaborated in work to

develop our environment and natural

resource management policy.

• Disaster risk management is a major

element of building resilience to climate

change. Thus disaster prevention and

recovery are likely to increase in

prominence – for example, flood and

drought risk management, and

emergency response and rehabilitation

to damaged rural infrastructure and

agricultural capacity.

• Beyond sectors, there will be greater

use of new tools and approaches.

There is scope to improve the relevance

and quality of climate-related information

to smallholders. Financial services

programmes, such as microinsurance,

are being modified to incorporate

climate risk, including affordable weather

index-based insurance that can help

smallholder households in developing

countries improve their financial security

and protect their livelihoods in the event

of extreme weather events and natural

disasters. Participatory and vulnerability

mapping techniques12 are being used to

improve community-based adaptation

efforts. New technologies are being

piloted or scaled up to assist in building

resilience (e.g. special irrigation piping

that enables waste water and salt water

to be used for irrigation purposes).

Potential modifications to farming

practices are described in box 2.

• Depending on the further development

of carbon markets, there may also be

greater investments in helping poor

smallholders – including women and

indigenous peoples – access

emissions-reduction incentives such as

voluntary or formal carbon markets.

11 As an example of

possible collaboration in

pro-poor mechanisms, IFAD

will support a pioneering

national programme in

Ecuador (Sociobosque) to

reward poor rural people for

conserving forests and

reducing emissions.

12 See, for example, the

decision-support tool

CRiSTAL(Community-based

Risk Screening Tool –

Adaptation & Livelihoods).

Training was organized in

IFAD in the context of

the CLIMTRAIN project,

and the tool was used

to undertake an adaptation

review in three ongoing

IFAD projects in Brazil,

Kenya and Mongolia.

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Such investments will be assessed like

any other market-creating activities.

Investments in emissions-reduction

activities are likely only when they either

yield an income-diversifying payment for

poor people or they are ‘win-win’ – that

is, they would be done anyway since

they benefit the community even without

specific rewards for reduced emissions.

For example, sustainable management

of forests, as an approach that

encompasses social, economic and

environmental goals, offers good

opportunities to reduce deforestation

and increase carbon sequestration.

BOX 2 Technical examples of adaptation and mitigation in agriculture

Issue

Crop management

Rangelands and pasture

management

Livestock management

Restoration of degraded

lands with high production

potential

Coastal management and

fisheries

Bioenergy

Disaster preparedness

Activity

Applying conservation agriculture – minimum disturbance of soil,

in combination with maintenance of year-round soil cover plus

crop rotation, preferably with inclusion of leguminous crops to boost

soil nitrogen.

Adopting new crops, crop rotation and/or crop varieties, adjusting

the time of planting/harvesting; introducing integrated soil-fertility

management systems that cater to the nutritional needs of

the crop without polluting the environment; and integrated water-

management practices.

Managing grazing systems and grazing intensity, fire management

and pasture rehabilitation.

Modifying herd composition: varied species/breeds; adapting grazing

management practices to increase soil carbon.

Reducing greenhouse gas emissions from livestock by improving

animal nutrition, breed selection and manure management.

Applying erosion control, soil and water conservation, organic

amendments, perennial or deep root crop systems.

Improving land and soil, including drainage, desalinization, addition of

gypsum to renovate sodic soils.

Promoting non-destructive fishing techniques to maintain resilience of

marine ecosystems; aquaculture in areas inundated by rising sea levels.

Achieving carbon sequestration in mangrove plantations and culturing

of seaweed and algae for food and biofuel.

Using crop residues, cellulosic crops (e.g. switchgrass), non-food

biofuel crops (e.g. Jatropha, Pongamia), dual-purpose biofuel crops

(e.g. sugar cane, sweet sorghum, cassava) and biogas.

Improving risk management and preparedness – e.g. better

agrometeorological warning systems, drought contingency plans,

response to flooding, awareness-raising, weather-indexed risk insurance.

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Strategy goal, purpose and output

Climate change is a cross-cutting thematic

issue that is changing the physical, political

and financial context of IFAD operations.

The Fund’s existing mandate and

comparative advantage in working with

smallholders oblige us to respond to

climate change in parallel with, and in

addition to, a range of other development

challenges. IFAD is doing a lot already,

but it can do more. Thus the goal of the

IFAD Climate Change Strategy is to

maximize IFAD’s impact on rural poverty

in a changing climate.

Figure 1 sets out the goal and three

statements of purpose. The main output for

this strategy is a ‘climate-smart’ IFAD. As

described above, climate change is a

theme that runs through all IFAD does, thus

it cannot be addressed through a

disconnected set of activities. Climate

change cannot be an add-on, and is not

seen as a separate sector or optional extra.

The approach of this strategy is to help

ensure that climate change – alongside

other risks and themes – is systematically

integrated into IFAD’s core programmes,

policies and activities.

IFAD cannot, and should not, work alone on

the climate change aspects of rural

development. The depth and breadth of

climate threats means that all major

international organizations are considering

how they can help. This implies a wide

range of partnerships for IFAD: national

governments, the United Nations family

Maximizing IFAD’s impact on rural

poverty in a changing climate

3FIGURE 1 Strategy goal and purpose

GOAL

To maximise IFAD’s impact on rural poverty in a changing climate

PURPOSE 1

To support innovative

approaches to helping

smallholder farmers build

their resilience

to climate change

PURPOSE 2

To help smallholder

farmers take advantage

of available

mitigation incentives

and funding

PURPOSE 3

To inform a more

coherent dialogue on

climate change, rual

development agriculture

and food security

19

(including the UNFCCC), the Global

Environment Facility (GEF), the donor

community, other IFIs, international civil

society and the private sector (in particular,

farmers and rural producers’ organizations).

IFAD’s choice of partnerships will be based

on what makes the biggest difference for

our clients – they are described in sections

A through D.

A climate-smart IFAD means that climate

change is appropriately reflected in our

approaches to: operations; knowledge,

innovation and advocacy; resource

mobilization; and organization.

Operations

IFAD will build the capacity of our country

programmes to more systematically

respond to increasing demands from our

clients for help and innovation on climate

change. This means enabling climate

change as part of our toolkit for the early

stages of country programme and project

design, rather than as an overly

compliance-driven approach in the final

approval stages for country strategic

opportunities programmes (COSOPs) and

programmes/projects. In terms of overall

direction, IFAD’s next strategic framework

will see climate, environment and

sustainable natural resource management

fully integrated into analysis and objectives.

FIGURE 2 IFAD climate partnerships

COUNTRY LEVEL

• National stakeholders,

including central

governments, local

institutions, community-

based organizations

• Harmonization with

donor community

(bilateral and multilateral)

RESOURCE

MOBILIZATION

• Global Environment

Facility, including GEF

Trust Fund and GEF-

managed UNFCCC funds

• Adaptation Fund

• Private sector and

foundations

• Donors and IFIs

KNOWLEDGE,

INNOVATION AND

ADVOCACY

• UN family

• Farmers’ organizations,

indigenous peoples

groups, international civil

society

• Research centres and

think tanks

• Donor community

(i.e. GDPRD)

• IFIs

© IFA

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We will use key partnerships on the ground,

such as community-based, farmers’ and

women’s organizations, NGOs, and national

and local public institutions, including

agriculture ministries. Our aim will be to

empower local communities and their

institutions to participate in climate-change-

related decision-making processes, and to

build their capacity to respond using their

own and others’ experience. Based on its

growing in-country presence, IFAD will also

engage where appropriate in country-level

climate and environment coordination

efforts, working closely with bilateral and

multilateral donors, and taking advantage

where appropriate of the capacity of

partner organizations.

Country strategies

COSOPs are increasingly reflecting new

thinking about how climate change is

altering the development context for IFAD’s

partners. But we can go further in ensuring

that expertise is available to do this

systematically.

Potential questions to be addressed in

COSOP design are: (i) what are the latest

available estimates of climate impacts on

poor rural people – particularly on IFAD’s

partner communities – using disaggregated

impacts (e.g. sex-disaggregated impact

data if available); (ii) how could national

poverty and climate change plans guide the

choice of investments; (iii) are there any

overall estimates on climate-related risk to

the existing and planned portfolio; (iv) are

there any areas for potential IFAD support

that could generate rewards for the

mitigation actions of smallholders; (v) what

has been IFAD’s past experience,

comparative advantage and value-added on

climate-related work in the country and

what is its potential for scaling up; and (vi)

what climate-related activities could be

incorporated into IFAD-supported projects

and policy advice.

How will IFAD achieve this?

• Enhanced stock-taking of current,

relevant NRM work in country and

regional programmes, which can provide

lessons and be expanded and scaled up;

• Greater capacity for systematic and

enhanced participation of relevant

climate and environment expertise in

country programme management teams

and missions;

• Deeper integration of climate analysis

into environment and social assessment

(ESA) tools – i.e. expand the scope of

analysis to more fully include climate

change questions. This process will feed

into any potential enhancements of ESA

procedures in our ENRM policy;

• Factoring emerging knowledge on

climate change into COSOP mid-term

reviews; and

• Inclusion of climate-change threats and

opportunities in subsequent revisions to

the guidelines for results-based COSOP

(RB-COSOP) formulation.

Project design and implementation

Similarly, climate change is featuring

increasingly in the purpose and risk

analyses of new projects. Again, there is

an opportunity to provide more support

so that this is done systematically and

makes the best use of available knowledge

and expertise.

Our priority will be to ensure that project

identification, design (including quality

assurance), and implementation are based

on an understanding of climate change in a

local context, how it affects different

categories of poor rural people, and women

as compared with men. Rather than special

treatment for climate change, this requires

including it alongside other relevant project

risks and opportunities, particularly those

21

related to environmental threats. This may

require engaging with communities to

assess specific climate-related risks to

communities and to project success (and

their financial implications); and then

working with them to identify and analyse

alternative project designs or approaches to

reduce or eliminate these risks. A wide

variety of new tools and approaches are

available to help in this assessment. IFAD

grants can support innovations and

capacity-building activities in this regard.

How will IFAD achieve this?

• Increase staff knowledge of and

sensitivity to the role of climate change

issues in IFAD’s mission, and their

knowledge of experiences in, and

practical tools for, building climate

change into country and regional

programmes and projects;

• Again, systematic and enhanced

participation of climate and environment

expertise in country-level dialogue

through country programme

management teams and missions;

• New tools – a climate risk tool for

screening COSOPs and projects is

under development, as well as

enhanced attention to climate change

in ESA;

• Sharing knowledge internally on how

climate change risks and opportunities

can be integrated into project design –

for example there may be more

opportunities to factor climate change

issues (climate risks, impacts of response

measures, technical and economic

mitigation potential of agricultural

activities) into social, technical,

economic and financial analysis;

• Implement the quality enhancement (QE)

process: projects are assessed in the

context of a number of key success

factors (KSFs), which include a question

on the vulnerability to climatic shocks of

poor rural people whose livelihoods

depend on agriculture and NRM;

• Appropriate integration of climate-related

issues in project monitoring and

evaluation and knowledge management

systems, mid-term reviews, and

supervision and project status reports.

These procedures will be facilitated by

inclusion of such elements where

appropriate in the original project design.

Knowledge, innovation and advocacy

Sharing of knowledge and innovation is part

of IFAD’s core business. In line with the

IFAD Strategy for Knowledge Management,

lessons and innovations from the field will

be shared across the organization and

externally. Individual country experiences

must be mainstreamed and scaled up to

ensure their application throughout IFAD’s

programmes and to draw on learning from

IFAD’s research grant portfolio. There is still

a need to profit from the knowledge and

experiences of others, including indigenous

knowledge systems and international

research centres – which will require

innovations in IFAD’s knowledge

management and partnership approaches.

IFAD will continue to raise the profile of

smallholder agriculture in international policy

discussions on climate change, and vice

versa, to increase the attention of

agriculture discussions to climate change.

This communication and engagement effort

is tightly focused, given the staff capacity

needed to manage IFAD’s operational task

on the ground. Working with the Global

Donor Platform for Rural Development

(GDPRD), the Food and Agriculture

Organization of the United Nations (FAO),

farmers’ organizations and others, IFAD

22

made progress in 2009 in encouraging

greater recognition of agriculture in climate

negotiations – draft negotiation texts now

feature greater attention to agriculture

and to the possibility of a future technical

work programme. Various IFAD co-hosted

side-events at UNFCCC negotiation

meetings and communication efforts in

2009 engaged climate negotiators and

the public in a consideration of what

concrete measures in negotiations are

most important to smallholders.

Key deliverables will include:

• New arrangements for outsourcing

expertise: exploration of new resource

centre arrangement(s) with reputable

organizations or consortia to provide

expert advice, where needed, in the

development of programmes and staff

training (for example, partnership with

the World Bank’s BioCarbon Fund –

paragraph 36);

• Support to regional divisions and

technical focal points of IFAD by the new

Environment and Climate Division for

establishing an internal climate and

environment network to share knowledge

and coordinate IFAD’s efforts;

• Systematic knowledge-sharing and

learning on climate change within the

country programmes, particularly with

regard to experiences from the field,

and adequate training for staff;

• Preparation of thematic guidebooks,

learning notes, case studies, climate-

change-related country profiles and

regional climate change outlooks, as a

way to inform country programmes;

• Continued use of country and global

research grants to support the

generation and development of

appropriate technologies that build on

local knowledge systems and blend

them with the best available formal

science options;

• Continued lesson-learning from

evaluations of IFAD’s climate- and

environment-related work.

Key knowledge, innovation and advocacy

partnerships:

• Farmers’ organizations, indigenous

peoples and international civil society.

Rural producers’ organizations and civil

society organizations are important

partners, particularly for advocacy in the

climate change arena. Building on

ongoing relationships with organizations

such as the World Wide Fund for Nature

(WWF), International Institute for

Environment and Development (IIED),

United Nations Permanent Forum on

Indigenous Issues (UNPFII) and

producers’ organizations involved in the

Farmers’ Forum, IFAD will increase its

collaboration with relevant groups to

raise the voice and emphasize the

concerns of smallholder farmers.

• United Nations family and Rome-based

agencies. IFAD will continue to engage

in concerted efforts with other United

Nations agencies:

(i) Through collaboration by the three

Rome-based agencies, which will

continue to be a priority, as identified

at the Rome heads of agencies

meeting in September 2009.13 IFAD

already works closely with FAO on

the technical aspects of mitigation

(e.g. testing FAO’s Ex-ante Appraisal

Carbon-balance Tool [EX-ACT]) and

general advocacy work, and with the

World Food Programme (WFP) on a

13 IFAD, “Directions for

collaboration among the

Rome-based agencies”,

note document prepared for

review by the ninety-seventh

session of the Executive

Board, 14-15 September

2009.

23

weather risk insurance programme in

China. In addition, the Rome-based

agencies have started a collaborative

partnership on disaster risk

management. It aims to integrate

such management into rural

development and agriculture sector

planning, including a range of rural

financial services and products for

risk prevention measures. IFAD will

continue to deepen these

collaborative efforts, making more

use of FAO’s analytical capacity and

– given the impact of climate change

on disasters and vulnerability – with

WFP on disaster preparedness, relief

and early recovery work. IFAD will

also continue to work with the Global

Mechanism of the United Nations

Convention to Combat Desertification

(UNCCD) in strengthening the ability

of countries to respond to the threat

of desertification;

(ii) Through the climate change working

group of the Chief Executives Board

High-level Committee on

Programmes, in support of the

UNFCCC process, as well as in the

delivery of common products;14

(iii) Through our work with the UNFCCC

secretariat, particularly on technical

matters related to adaptation and

mitigation in agriculture and on

initiatives such as the Nairobi Work

Programme on impacts, vulnerability

and adaptation to climate change.15

IFAD’s main objective will be to

increase attention to the needs and

concerns of smallholder farmers in

the post-Kyoto global climate

agreement, and to continue

supporting implementation of the

Convention by delivering

programmes identified in national

adaptation programmes of action.

• The Consultative Group on International

Agricultural Research (CGIAR) is one of

IFAD’s main research partners. The

recently launched 10-year Challenge

Programme on Climate Change,

Agriculture and Food Security offers new

opportunities to engage with the CGIAR

on climate change research. IFAD will

also link its works to other emerging

initiatives relevant to its target group,

such as the Global Research Alliance on

agricultural greenhouse gases.

• International financial institutions: IFAD,

as both an IFI and a United Nations

specialized agency, will increase its

engagement and knowledge-sharing

with other IFIs. It is already an active

member of the Multilateral Financial

Institutions Working Group on

Environment that has made significant

progress towards harmonizing the

approach MFIs take to environmental

issues, particularly in relation to

environmental impact assessment. IFAD

will also engage with and learn from the

experience of the Climate Investment

Funds, in particular the Pilot Programme

for Climate Resilience and the Forest

Investment Program.

• Donor community: membership in the

GDPRD offers a space for coordinated

action on climate change within the

donor community. Building on its current

and ongoing engagement with the

platform, IFAD will continue to take part

in the development of a coherent

approach among donors to agricultural

mitigation and adaptation.

14 In 2009 the United

Nations system engaged in

a number of joint initiatives

and tools, such as the joint

paper on adaptation

presented at COP15 and

the UNCCD: Learn platform,

to which IFAD contributed

through its internal climate

change training (i.e. the

CLIMTRAIN project).

15 IFAD joined the

UNFCCC Nairobi Work

Programme on impacts,

vulnerability and adaptation

to climate change in

October 2007. The aim of

this programme is to help

countries improve their

understanding and

assessment of the impacts

of climate change and to

make informed decisions on

practical adaptation actions

and measures.

24

Resource mobilization

Climate change is increasing the cost of

development, and the international

response has added a layer of complexity

to the provision of international public

finance to developing countries. Climate

change is already becoming a more

prominent driver of the provision of

international financial support, and

significant spending commitments were

made as part of the Copenhagen Accord

(see paragraph 11). As climate negotiations

evolve, IFAD will continue to explore how

we can enhance our role, together with

other agencies, in the deployment of

greater financial assistance, calibrated

according to our ability to deliver and

aligned with our core programmes and

mandate. It is already clear that climate

change adaptation will be an important

element of future climate change finance,

which fits well with IFAD’s core mandate.

Based on this strategy’s principle of

integrating climate change throughout IFAD,

our primary focus is on making IFAD’s

expanding portfolio climate-smart.

Supplementary funds will be used to help

deepen integration of climate change into

our core programmes. These funds will

meet the additional costs of climate-smart

project investments and technical

assistance, and enable more innovative

approaches to address climate threats

and opportunities.

Key resource mobilization partnerships:

• Global Environment Facility: as the

financial mechanism of the UNFCCC,

the GEF represents a major strategic

partner, going beyond resource

mobilization and including knowledge

management. Through the GEF

partnership, IFAD has deepened its

engagement and cooperation with the

other GEF agencies.16 Of relevance to

IFAD, the GEF manages the GEF Trust

Fund, the Least Developed Countries

Fund (LDCF) and the Special Climate

Change Fund (SCCF). IFAD’s GEF

portfolio is approximately US$100

million, with cofinancing of approximately

US$370 million from IFAD-supported

projects. IFAD will continue to work with

the GEF through the

(i) GEF-5 Trust Fund: IFAD aims to

significantly increase our use of GEF

resources in the next GEF

replenishment for the period 2010-

2014. Success will in part depend on

the size of the next replenishment,

and on ongoing project cycle reforms

and programmatic approaches. IFAD

is active in four of the six GEF focal

areas: land degradation, biodiversity,

international waters and climate

change. A stable or increasing GEF

replenishment would present an

opportunity for IFAD to continue

increasing its still-small share of

the GEF portfolio (2.9 per cent for

GEF-4). The GEF’s ongoing efforts to

streamline the project cycle would

facilitate integration of GEF financing

into our overall portfolio. These

resources would continue to be used

to mobilize IFAD investments based

on our GEF-4 mobilization ratio of 1:4.

(ii) UNFCCC’s GEF-managed LDCF

and SCCF: depending on the

replenishment of these two funds,

over the next four years IFAD will

aim to significantly increase its

LDCF/SCCF pipeline with innovative

projects that help rural communities

address the additional costs of

climate change to their development

efforts.

• Adaptation Fund:17 IFAD is submitting

an application to serve as a multilateral

implementing entity of the Adaptation

Fund, which will finance concrete

16 African Development

Bank (AfDB), Asian

Development Bank (AsDB),

European Bank for

Reconstruction and

Development (EBRD),

FAO, Inter-American

Development Bank (IDB),

the World Bank, United

Nations Development

Programme (UNDP), United

Nations Environment

Programme (UNEP), and

United Nations Industrial

Development Organization

(UNIDO).

17 The Adaptation Fund

was established by the

Parties to the Kyoto

Protocol of the UNFCCC

and is hosted by the GEF.

25

adaptation projects and programmes in

developing countries that are parties to

the Kyoto Protocol. The details of

access and Adaptation Fund priorities

are being finalized. Resources available

will depend on developments in the

carbon market.

• Corporate private sector and

foundations: the private sector will

ultimately drive the investment response

to climate change. IFAD will explore

further possible collaboration with

private foundations, building on its

successful partnership with the Bill and

Melinda Gates Foundation for weather

insurance in China.

• Rewards for emissions reductions: IFAD

will develop its partnership with the

BioCarbon Fund, administered by the

World Bank, in its third agriculture-

related tranche (to be committed by

2012) to demonstrate projects that

successfully sequester or conserve

carbon in forests and agroecosystems.

Where appropriate, IFAD will take

advantage of the BioCarbon Fund

team’s carbon market expertise to

assess potential income-generating

emissions-reduction activities, and will

seek its potential investment.

• Donors and IFIs: IFAD remains open to

bilateral financing partnerships to

expand our climate and environment

integration and support18 – including the

financing of stepped up analytical

support to IFAD’s clients and

development of climate-smart COSOPs

and programmes. IFAD will encourage a

harmonized approach to the provision of

such cofinancing support (such as

common reporting and memorandums

of understanding). IFAD will also

continue to explore engagement with the

European Commission’s Global Climate

Change Alliance and the World Bank-

administered Climate Investment Funds.

Organization

IFAD has always been perceived as and

prides itself on being a ‘front-line’

international agency that focuses its efforts

at project and country programme levels

with an emphasis on direct results.

Accordingly, transforming the above three

statements of purpose into tangible results

for poor rural people will involve

strengthening IFAD’s ability to assess

relevant climate risks, identify mitigation and

adaptation opportunities, and implement

and monitor effectively and efficiently.

Success at the country level will require

effort across the organization – including

the President, regional divisions and country

offices, the Communications Division, and

facilities management. In order to support

regional divisions and Senior Management

in realizing the Fund’s implementation and

advocacy goals, IFAD must reinforce its

capacity. This will be achieved with a

modest internal staff increase, together with

training, new arrangements for accessing

external expertise, and deeper partnerships

on climate change.

Key elements of IFAD’s organizational

response are

• Making greater use of existing in-house

skills and people through (i) identifying

dedicated in-house capacity to deliver

high-quality programmes and (ii) staff

training. Building on the experience of

the CLIMTRAIN project,19 IFAD will

design and make available to its staff an

e-learning training programme on

climate change and rural development;

18 As in the case of

Ethiopia, where Spain is

supporting additional

activities for adaptation to

climate change in a joint

IFAD/GEF project.

19 www.ifad.org/climate/

climtrain/.

26

• Creating a new organizational structure

with increased dedicated expertise on

climate and the environment: a new

Environment and Climate Division (ECD)

– housed in the Programme

Management Department (PMD) – will

share operational staff with the regional

divisions in pursuing a common agenda

of climate and environment integration

throughout IFAD. It will also bring

together staff working on climate and

the environment to enable (i) continued

development of the GEF pipeline;

(ii) more support to the regional divisions

on COSOPs and non-GEF programme

development; (iii) innovation and

knowledge management on the

environment and climate change; and

(iv) managing external partnerships and

global initiatives on climate and the

environment;

• New arrangements for outsourcing

expertise;

• Demonstrating the values of

environmental awareness internally. IFAD

is committed to playing a proactive role

in the United Nations carbon neutral

initiative. It is actively doing its share to

minimize the impact of its operations on

the environment and to lower its own

carbon imprint. The restructuring of the

new IFAD headquarters was based on a

green-building, sustainable design – and

IFAD is currently seeking Leadership in

Energy and Environmental Design

certification, which will recognize the

building’s high performance with respect

to water savings, energy efficiency,

material selection and indoor air quality.

A voluntary IFAD Go Green Group is

actively involved in creating awareness

in-house of environment-friendly

behaviour. Two working groups are

focusing respectively on policies in our

field operations and on a carbon-neutral

imprint for the Fund’s facilities. IFAD is

revising its travel policy: specific

provisions will be made in relation to

carbon emissions, and elements of

emissions mitigation will be part of the

new travel manual.

27

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A results and implementation framework for

the IFAD Climate Change Strategy is

presented in annex I. In line with the overall

approach of the strategy, the framework

seeks to embed climate-related issues

appropriately across IFAD’s results-based

measurement system. As a theme that runs

throughout our work, the success of the

strategy will be assessed through a number

of proxy measurements largely related to

portfolio performance and activity

implementation. Given IFAD’s country-driven

approach, and the cross-cutting nature of

climate change, specific sectoral indicators

are not used as an indicator of success.

IFAD’s ENRM policy will elaborate on results

measurement in the context of IFAD’s

NRM activities.

Measuring success

4

29

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Goal: To maximize IFAD’s impact on rural poverty in a changing climate.

Statements of purpose:

• To support innovative approaches to helping smallholder producers build their resilience

to climate change.

• To help smallholder farmers take advantage of available mitigation incentives and funding.

• To inform a more coherent dialogue on climate change, rural development, agriculture

and food security.

Output: a climate-smart IFAD

Annex I

IFAD Climate Change Strategy results and implementation framework

Strategic themes

1. Climate-smart

operations

Strategy objectives

COSOPs and

programmes

systematically

reflect climate and

environment risks

and opportunities

December

2010

By December

2010

By end-2010

Ongoing

Ongoing

Outcome indicators

• From end-2010 all new COSOPs

submitted to the Executive Board

and new programme documents

systematically and appropriately

reflect climate and environment

risks and opportunities

• Project completion reports:

increased percentage of projects

rated 4 or more for environment

over baseline of 77 per cent

(2008-2009 two-year average) for

2013-2014 cohort

• Results and impact management

system: by 2014, average rating

increased to 4.25 in 2nd-level

indicators (effectiveness/

sustainability) for natural resource

interventions over baseline of

3.75 for 2009

• Increased satisfactory ratings

under the natural resources and

environment domain for projects

evaluated in the ARRI report

• QE panel report overall

assessment highlights climate

change concerns, QE panel

summary assessment sheets

record KSF rating for climate-

change-related questions

Implementation milestones

IFAD’s next strategic

framework will see climate,

environment and sustainable

natural resource management

fully integrated into its

analysis and objectives

RB-COSOP formulation

and quality enhancement

guidelines updated to include

climate change issues

Enhanced ESA climate

change inputs piloted

(including risk-screening tool

of the IFAD Initiative for

Mainstreaming Innovation)

Climate-change expertise

participation enhanced in

country programme

management teams and

missions

Climate-change sensitivity

of design regularly tracked

at QE

31

Strategic themes

2. Climate-smart

knowledge,

innovation and

advocacy

3. Climate-smart

resource

mobilization

4. Climate-smart

internal

organization

Strategy objectives

Enhanced internal

and external

climate-related

knowledge

management, in

parallel with

continued global

and national

advocacy

Additional

supplementary

funding secured to

assist in systematic

integration of

climate risks and

opportunities into

overall portfolio

Appropriate

resource levels and

internal procedures

Ongoing

By mid-2011

Ongoing

June 2010

Ongoing

Ongoing

Ongoing

Ongoing

From

June 2010 to

June 2014

From

June 2010 to

June 2014

From

mid-2010

2011

By March

2010

By June 2010

2011

Outcome indicators

• Agricultural issues, and

needs and concerns of poor

rural people, appropriately

reflected in final post-Kyoto

agreement

• Reform of the Clean

Development Mechanism

(CDM) to allow greater

inclusion of agriculture

• Frequency of IFAD climate-

related events

• Implementation of actions

on climate change of

“Directions for collaboration

among the Rome-based

agencies”

• Frequency of climate-related

IFAD media interviews and

publications

• At least 25 per cent increase

in GEF-5 Trust Fund cofinancing

of IFAD operations over

the next GEF replenishment

period 2010-2014

• At least 40 per cent increase

in combined LDCF and

SCCF cofinancing of IFAD

operations over the next

GEF replenishment period

2010-2014

• Pending the outcome of

CDM reform, at least two

further IFAD projects

cofinanced with BioCarbon

Fund by end-2011

• Five additional climate and

environment experts recruited

to IFAD by June 2011

• Shared (ECD and regional

divisions) regional environment

and climate specialists in at

least three regional divisions by

June 2011

Implementation milestones

Continued IFAD engagement in

support of global climate and

agriculture dialogue

New knowledge service

arrangement(s) with reputable

organizations or consortia to

provide expert advice and staff

training

Enhanced collaboration with

United Nations family and Rome-

based agencies on climate change

IFAD internal climate and

environment network established

to ensure that knowledge is shared

Knowledge/training products

and events rolled out –

including CLIMTRAIN web-based

training package

Inclusion of climate change in

grant programmes

Engagement to support coherent

donor approach to climate

change through GDPRD

Continued engagement to

support global climate and

agriculture dialogue

Increased GEF-5 grant financing

secured to support IFAD

operations related to climate

change and the environment

Increased UNFCCC LDCF/SCCF

grant financing secured to

support IFAD operations in next

LDCR/SCCF replenishments

IFAD access to the Adaptation

Fund established, with five-year

engagement plan prepared

and implemented

BioCarbon Fund – rewards

for emissions-reduction projects

piloted

ECD created, capacity increased

and staff shared with regions

IFAD certified as leader in Energy

and Environmental Design

IFAD travel manual updated to

include specific provisions to

reduce carbon emissions imprint

32

A strategic partnership

IFAD and the GEF work together to support countries in addressing the intertwined issues

of poverty alleviation, environmental degradation and climate change, with a focus on rural

development needs.

As the only United Nations agency dedicated exclusively to fighting rural poverty, IFAD

brings to this partnership its extensive experience in sustainable rural development and

integrated environmental management, as well as its strengths in identifying synergies and

addressing cross-cutting environmental issues.

This alliance with the GEF enables IFAD to enhance its contribution to sustainable NRM,

and to fight climate change and its consequences, while improving the living conditions of

poor rural people.

The IFAD/GEF partnership capitalizes on the linkages between GEF strategic objectives and

IFAD programmes and projects, making them mutually reinforcing. As a GEF agency, IFAD

can access funds under the GEF Trust Fund. It is also able to access climate change funds

under the UNFCCC’s Least Developed Countries Fund (LDCF) and Special Climate Change

Fund (SCCF), managed by the GEF secretariat.

IFAD and the GEF: Meeting environmental and rural development challenges

in a rapidly changing world

IFAD became a GEF agency in 2001 and created a dedicated unit in 2004, housed in its

Programme Management Department. During these five years of collaboration, IFAD has

Annex II

IFAD/GEF portfolio: Building on a strong foundation

FIGURE 1 IFAD portfolio by region(Total financing in millions of United States dollars)

Other Financing

0

50

100

150

200

250

US

$ M

illion

s

Near East and North Africa (8 grants)

Sub-saharan Africa (11 grants)

Asia (6 grants) Latin America and Caribbean (5 grants)

GEF Financing

IFAD Financing

GEF Portfolio and co-financing distribution by region

58,076

38,378

29,515

65,682

40,72

103,787

32,894

32,018

21,81

29,255

39,183

19,443

33

secured a total grant portfolio of 30 projects under its direct responsibility, totalling

US$111.4 million from the GEF, directly linked to US$399 million in investments

(US$213.3 million from IFAD investments and US$185.9 million of cofinancing from other

partners – figure 1). This cost-effective participation and its successful mobilization rate are

complemented by the quality control mechanisms and rigorous fiduciary procedures and

standards applied by IFAD.

Since its establishment, IFAD has worked intensively in marginal lands, degraded

ecosystems and post-conflict situations, with an emphasis on the people living in these

conditions. Consistent with this approach, nearly 40 per cent of IFAD/GEF grants are

invested in sub-Saharan Africa, complementing other IFAD operations for agriculture and

rural development in the region. The remaining 60 per cent are dedicated to the poorest

areas of Latin America and the Caribbean, Asia and the Pacific and the Near East and

North Africa (figure 1).

Most IFAD/GEF programmes are implemented in collaboration with other GEF agencies,

either as part of programmatic approaches or country programmes (led by the United

Nations Development Programme [UNDP] or the World Bank), or in association with other

agencies (African Development Bank [AfDB], the United Nations Environment Programme

[UNEP] and the United Nations Industrial Development Organization [UNIDO]).

IFAD’s comparative advantage for the GEF lies in its work in integrated management of land

and water and the sustainable use of biodiversity and forests – while simultaneously seeking

to lessen the impact of climate change on vulnerable rural communities and promote their

capacity to cope with changing climatic conditions. Approximately three fourths of the

IFAD/GEF portfolio supports sustainable natural resource and forest management practices,

while the remaining fourth is dedicated to climate change activities (figure 2).

Combating land degradation

IFAD was created in response to the droughts and food crisis that affected millions of people

in Africa and Asia in the early 1970s. It offers a major and unique comparative advantage in

supporting sustainable land management. With a strong track record in tackling land

degradation and promoting sustainable rural development and integrated land management,

FIGURE 2 Distribution of IFAD/GEF grants by focal area(Millions of United States dollars)

23%

18%

2%

57%

Climate change Biodiversity Land degradation International waters

34

IFAD plays a critical role in implementing the UNCCD and has full access to GEF funds

targeting land degradation. IFAD's focus on reducing rural poverty and fostering household

food security, its people-oriented participatory approaches, and its extensive experience in

drylands ensure that its programmes will deliver maximum results on the ground.

IFAD is the lead agency in the GEF programme of MENARID [Integrated Natural Resources

Management in the Middle East and North Africa Region Programme] (with GEF total

funding of nearly US$60 million), designed to promote such land management while

increasing the economic and social well-being of targeted communities through the

restoration and maintenance of ecosystems.

IFAD is also a major player in the GEF’s Strategic Investment Program (SIP) for sub-Saharan

Africa, which responds to the region’s urgent need to address land degradation and

sustainably improve natural-resource-based livelihoods. IFAD has mobilized US$100 million

(20 per cent from GEF grants) to promote sustainable land management in six countries.

Promoting sustainable forest management and biodiversity use

One of IFAD’s priorities is the efficient use of natural resources, enabling poor rural people to

benefit from these assets, while conserving and managing them sustainably. IFAD has

proven experience in promoting biodiversity conservation and water management through

participatory management mechanisms, including protected areas and buffer zones.

Roughly 40 per cent of IFAD/GEF projects include financing from the GEF biodiversity and

international waters focal areas.

Forest conservation and sustainable use, with a strong pro-poor approach, play a primary

role in IFAD strategy, due to their importance to and interlinkages with poor communities

and indigenous peoples. The IFAD Strategic Framework 2007 2010 recognizes the

importance of managing forests sustainably to reduce land degradation, while

simultaneously improving food security and providing alternative income sources for

communities and small-scale farmers. In this regard, IFAD is actively supporting the GEF’s

sustainable forest management strategy through five projects.

Fighting climate change

Under the GEF-4 replenishment, IFAD committed itself to prioritizing climate change as it

relates to rural poverty reduction, with a particular focus on adaptation. Under the GEF Trust

Fund, IFAD is supporting climate change adaptation as a cross-cutting issue within other

focal areas, particularly sustainable land management, within programmes such as

MENARID20 and SIP. Also, under the Special Pilot on Adaptation, IFAD is implementing a

community-based project to rehabilitate three key coastal ecosystems – mangroves, coastal

lagoons and sand dunes – along the tsunami-devastated east coast of Sri Lanka. The

project enhances their resilience to climate variability, while reducing the population’s

vulnerability to climate change.

In addition, IFAD is currently working with the governments of Mauritania, Senegal and

Sierra Leone to support implementation, through the LDCF, of the priorities of their

agriculture-related national adaptation programmes of action. With funding from the SCCF,

IFAD is supporting Jordan, Mongolia and Pakistan in implementing adaptation activities,

including technology transfer, in the livestock, water and crop production sectors.

In 2009, IFAD also began development of its climate change mitigation portfolio under the

GEF Trust Fund. The three projects currently being prepared in Mexico, The Sudan and the

Bolivarian Republic of Venezuela focus on promoting a climate-friendly rural development

path by increasing the carbon sequestration potential of land use, land-use change and

forestry activities in these countries.

20 Reducing Risks to the

Sustainable Management of

the North-Western Sahara

Aquifer System (NWSAS).

35

Enhancing collaboration under the fifth GEF replenishment

The financial crisis and rising food insecurity are intertwined global challenges for poor rural

people. Food price volatility in 2008 and the economic crisis in 2009 have resulted in

increased hunger. According to FAO, there were more than one billion people

undernourished in 2009, and food prices are on the rise again. Population growth – and

migration caused by poverty, climate change and natural resource degradation – will further

complicate the intertwined global crises. Poor rural people and smallholder farmers are the

most vulnerable to the combined action of these global crises, as they lack adequate

coping capacity.

Environmental degradation (mismanagement of forest, water and soil resources) is

aggravating the world food crisis, as resources become scarcer and of poorer quality,

affecting livelihoods, health and living conditions. Climate change – altering weather

patterns, melting glaciers and inducing more extreme events (droughts, storms, etc.) – will

further exacerbate these tensions.

Immediate action is needed to strengthen the resilience of agriculture to the challenges of

climate change and natural resource degradation, while sustainably improving the

productivity of agriculture in the face of growing demand for food.

The GEF partnership helps IFAD better integrate climate change and NRM into its core

mandate, while continuing to work with poor rural people to improve their living conditions.

Collaboration with the GEF secretariat and other GEF partners also allows IFAD to improve

and increase its efforts to reduce rural poverty through an appropriate blending of

operations. Similarly, integration of its efforts with the GEF enables IFAD to carry out more-

innovative and higher-risk approaches to addressing climate threats and opportunities.

Given the importance of the GEF in addressing global environmental issues, and its

important contribution to the achievement of IFAD objectives, the Fund fully supports a

significant and strong replenishment of GEF resources, as well as those of the other two

GEF-managed funds, the LDCF and SCCF.

IFAD also welcomes, and supports, the process of GEF reforms that will help make the GEF

more efficient, transparent and country-driven. One of the proposed reform measures, the

improvement of the GEF project cycle, will enable IFAD to deliver better results, while

continuing to leverage major IFAD cofinancing towards GEF-supported programmes.

Under GEF-5, IFAD would like to continue its collaboration with the GEF partnership,

increasing the engagement according to its comparative advantages, consolidating planned

and ongoing programmes and activities, and proposing new initiatives that can incorporate

new country partners and mobilize major cofinancing.

International Fund for

Agricultural Development

Via Paolo di Dono, 44

00142 Rome, Italy

Tel.: +39 06 54591

Fax: +39 06 5043463

E-mail: ifad@ifad.org

www.ifad.org

www.ruralpovertyportal.org